Core Viewpoint - Figma is positioned for a potential breakout despite its recent IPO volatility, with strong fundamentals and significant growth in AI investments [1][3][12] Company Performance - Figma's stock was initially listed at $33, peaked at $142.92 shortly after its IPO, but has since dropped to $37.33, nearly 75% below its peak [2] - The company reported a revenue increase of 38% to $274.2 million in the third quarter, with an adjusted operating income of $34 million, indicating solid profitability [10][11] Market Valuation - Figma's current market cap is approximately $19 billion, which is below the $20 billion valuation Adobe had proposed for the company four years ago [5][10] - The stock is trading at a price-to-sales ratio of roughly 15 after accounting for $1.5 billion in cash and marketable securities, which is considered reasonable compared to other software stocks [11][12] AI Investments - Figma is making significant strides in AI, launching tools like Figma Make, Figma Sites, and Figma Buzz, and acquiring Weavy, which has been rebranded as Figma Weave [8][9] - Despite initial market punishment for its AI investments, the integration of AI tools is seen as a strategic move that could enhance Figma's position in the web design software market [7][9]
This Artificial Intelligence (AI) Stock Is a Drop-Dead Bargain. And It Might Not Last Long